Theme T126 · Indian Economy

Growth: GDP measurement, potential GDP, savings, structure of growth

Share this theme

What UPSC asks

Questions ask the GDP methodology change in 2015, whether recovery was V-shaped, potential GDP and what limits it, whether savings are the key driver of growth, and why India jumped from agriculture to services.

Prepare these

• GDP base year 2011–12: factor cost to GVA at basic prices, MCA-21 data
• Potential GDP and output gap; determinants (capital, labour, productivity)
• Savings–investment link; other growth drivers
• Structural transformation: services-led growth and need for manufacturing
• COVID shock and recovery shapes

Answer writing

• Define concepts precisely, then apply to India with data

Directive words in these PYQs: Explain (2), Do you agree (2).

Linked themes

Comes back later in

Later themes that take this one further.

Syllabus lines covered

• GS3-L1 — Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.

All 5 PYQs, newest first

1. GS32021GS3-ECO-01-M2021-S01

   Explain the difference between computing methodology of India’s Gross Domestic Product (GDP) before the year 2015 and after the year 2015.

   CopyReport a typo
2. GS32021GS3-ECO-01-M2021-S02

   Do you agree that the Indian economy has recently experienced V-shaped recovery? Give reasons in support of your answer.

   CopyReport a typo
3. GS32020GS3-ECO-01-M2020-S01

   Define potential GDP and explain its determinants. What are the factors that have been inhibiting India from realizing its potential GDP?

   CopyReport a typo
4. GS32017GS3-ECO-01-M2017-S01

   Among several factors for India’s potential growth, savings rate is the most effective one. Do you agree? What are the other factors available for growth potential?

   CopyReport a typo
5. GS32014GS3-ECO-01-M2014-S01

   Normally countries shift from agriculture to industry and then later to services, but India shifted directly from agriculture to services. What are the reasons for the huge growth of services vis-à-vis industry in the country? Can India become a developed country without a strong industrial base?

   CopyReport a typo